COUNTING THE COST OF PRIVATISATION

RMT helpline 0800 376 3706 :: january 2020 :: RMTnews 15 As rail fares rise yet again above the rate of inflation, RMT can reveal some of the cost of ten years in which successive governments have failed to tackle the scandal of rail privatisation. The union analysed company accounts and dividend payments from every train operating company who had a franchise contract at any point between 2010 and 2019. Since 2010, the Train Operating Companies (TOCs) have paid out £2.05 billion in dividends to their shareholders. Over the same period, the Rolling stock companies (Roscos), who make money by leasing trains to the TOCs paid out £2.39 billion to their shareholders, often based in low tax jurisdictions like Luxemburg. This means that between 2010 and 2019, shareholders have made more than £4.4 billion out of the private companies who own our trains and run our railways, turning passenger revenue and public subsidies into private profit. This is likely to understate the extent of dividend payments as many company results for 2019 have yet to be filed. That is £4.4 billion that could have been reinvested in our railways to improve infrastructure or cut fares. Table 4: ROSCO Dividends 2010-2019 2010 2011 2012 2013 2014 ROSCO Dividends 2015 2016 2017 2018 2019 Total £47.6m £70m Porterbrook £35m £35m £100m £120m £85.5m £80m £573.14m £0 Eversholt £0 £40m £0 £50m £20.7m £14.7m £43.0 £40.m £20.9m £229.6m Angel £112.4m £151.4m £859.6m £18m £85m £60m £95m £65.3m £147m £1,593.7m Total £112.4m £199m £969.6m £53m £170m £180.7m £229.8 £193.9m £267.1m £20.9m £2396.4m Table 3: TOC Dividends 2010-191 2010 2011 2012 2013 TOC Dividends 2014 2015 2016 2017 2018 2019 Total £0 £0 £51m £9.5m £1m £62m Abellio Greater Anglia £0 £0 £0 £0 £0 Abellio Scotrail £0 £0 £0 Abellio West Midlands £0 £0 £0 £0 Arriva Chiltern £0 £0 £0 £0 £0 £0 £0 £0 £0 £0 £0 Arriva Cross Country £0 £22m £20m £25m £67m £4.5m £4.5m £9m Arriva Rail London £0 £0 £0 £0 Arriva Rail Northern £11m £15m £16m £16m £15m Arriva Trains Wales £15m £20m £20m £19m £147m £0 £0 £0 £4m £0 C2C Essex Thameside £4m £0 £0 £5m £23.1m £1.3m £29.4m First Capital Connect £0 £50m £39m £30m £40m £50m £209m First Greater Western £0.5m £2m £7m £0 £5.1m £14.6m First Hull Trains Ltd £18m £14m £16m £12m First Scotrail £21m £22m £11.6m £114.6m £0 £0 £0 First South Western Railways £0 £0 £0 £0 £0 First Transpennine Express £42.5m £30m £31m £21m £30m £4.5m £20m £24m £203m First/Keolis Transpennine Express £0 £0 £0 £0 £0 £0 £0 £25m £25m Govia London and Birmingham (London Midland) £12m £11m £20m £7m £5m £25m £37m £30m £25m Govia Southeastern Railways £172m £7.2m £2.5m £14m £13.2m £25.6m £18m £16m £10m Govia Southern Railways £2m £108.5m £0 £0 £0 £0 £0 £0 £6.9m Govia Thameslink Southern, Great Northern £7.2m £8.7m £8.9m £13.9m Serco/Abellio Merseyrail £11.7m £12.3m £12.3m £13.3m £16.5m £111.8m £0 £0 £0 £0 £0 Serco Caledonian Sleeper £27.8m £22.5m £27.6m Serco Northern £34.2m £28.3 £17.8 £20m £177.9m £0 £0 £0 £0 £0 £0 £10m £15m Stagecoach East Midlands £35m £60m £30m £32m £17.5m £16m £10.8 £25m £20m £151.3m Stagecoach South Western Trains £0 £0 £0 £0 £18.6m Virgin East Coast £0 £0 £0 £18.6m £67m £30.5m £26m £39.8m £9.7m £6m Virgin West Coast £55m £47m £51m £41m £372.9m £192.3m TOTAL £162.5m £196.4m £192.7m £185m £182.7m £345.9m £271.3m £220.9m £107.5m £2.05 bn Table 1: Total dividends paid 2010-19 Total Dividends paid 2010-19 £2,057,149,000 Total TOC Dividends £2,396,464,430 Total ROSCO Dividends £4,453,613,430 Total Dividends paid Table 2: Projected dividend payments between 2019 and 2023 Total Forward projections 2019-23 £219,675,750 Average Dividend per Annum (All TOCs -2010-2018) £263,946,048 £483,621,798 Average ROSCO Dividend per annum (All ROSCOs - 2010-18) Average Dividend leakage (TOCs and ROSCOs) £1,098,378,750 Forward projection of TOC dividend leakage 2019-2023 £1,319,730,239 £2,418,108,989 Forward projection of ROSCO dividend leakage 2019-23 Total estimated dividend leakage 2019-23 By looking at the average annual dividend leakage from the private sector, RMT can also estimate the cost of another five years of Tory failure. Each year, on average, the private sector leaks £483 million out of the industry to its shareholder, so that we can expect that the sector will lose another £2.4 billion to shareholders over the next five years. The amount that these private companies funnel out of the sector toward shareholders every year is equivalent to 5% of annual passenger revenue. Note, figures begin and end when each company’s franchise contract begins and ends. The data has been rounded up so may not add up exactly. COUNTING THE COST OF PRIVATISATION Private companies siphon of £4.4 billion in dividends to shareholders over ten years of Tory failure Five more years will see another £2.4 billion sucked out of the network Annual dividend payments would equate to five per cent cut in fares